Wesfarmers subsidiary EVOL LNG has won a contract to supply LNG to the power station at Doray Minerals’ Deflector gold project in the Murchison region for an undisclosed sum.
EVOL LNG, which falls under the branch of Wesfarmers’ Kleenheat business, will supply about 4,560 tonnes of LNG per annum from its Kwinana plant to Deflector’s power station, which is currently being built by Pacific Energy.
The seven-megawatt power station will be dual-fuelled by 70 per cent LNG and 30 per cent diesel.
“Entering into an agreement with Doray during a period of historically low energy prices demonstrates our resilience in a highly competitive market, but the team’s also been pretty innovative to bring costs down,” EVOL LNG business manager Nick Rea said.
“Waste heat from the power station will be recovered to vaporise LNG instead of traditional ambient air fin vaporisers, making the solution more cost competitive.
“By using LNG at Deflector, Doray will reduce its exposure to imported diesel costs, avert more than 3,800 tonnes of carbon emissions per year compared to diesel, which is equivalent to removing more than 1,100 cars from the road, and support jobs in the local production and distribution of LNG.”
Doray managing director Allan Kelly said the use of LNG would provide Devlector with stable power and low energy costs throughout the project’s initial six-year mine life.
Pacific won the contract to build, own and operate the Deflector power station last month for an initial five years.
The station is set to be commissioned in April, at which point EVOL LNG will begin supplying LNG.
Doray shares were 1.6 per cent higher to 94 cents each at 10am.